CONCEPTUAL FRAMEWORK OF MONEY LAUNDERING AND REAL ESTATE
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Real estate transactions as a tool for laundering money have been recognized as the most sophisticated and robust method used by launderers to legalize their illicit gains. The real estate industry, given its unique nature characterized by high transaction amounts, lack of regulation, opacity and the ability to inflate the value, offers launderers the perfect platform to integrate their gains from the illegal acts into the legitimate economy. In India, which boasts one of the biggest property markets in the world and where an overwhelming majority of the transactions are conducted in the informal sector, the risk of real estate money laundering remains highly significant.
The present dissertation conducts a thorough study of real estate transactions as a mechanism of money laundering. The primary focus is on the Prevention of Money Laundering Act, 2002 (PMLA), and the property law in India. The project begins with a discussion of the concept of money laundering, three-tiered process involving placement, layering and integration, and analyses how these stages are accomplished within the real estate sector. Further, there will be a discussion of various provisions of the PMLA such as proceeds of crime, money laundering offence, power of attachment, reporting obligations, ED and FIUIND.
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Bawa, A. (2026). Conceptual Framework of Money Laundering and Real Estate. International Journal of Science, Strategic Management and Technology, 02(05). https://doi.org/10.55041/ijsmt.v2i5.264
Bawa, Ayush. "Conceptual Framework of Money Laundering and Real Estate." International Journal of Science, Strategic Management and Technology, vol. 02, no. 05, 2026, pp. . doi:https://doi.org/10.55041/ijsmt.v2i5.264.
Bawa, Ayush. "Conceptual Framework of Money Laundering and Real Estate." International Journal of Science, Strategic Management and Technology 02, no. 05 (2026). https://doi.org/https://doi.org/10.55041/ijsmt.v2i5.264.
References
Organizations: A Study into So-Called Underground Banking Networks 5 (1999).
2 See Financial Action Task Force, Guidance for a Risk-Based Approach: Real Estate Sector 7 (2022) [hereinafter FATF Real Estate Guidance].
3 United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances art. 3(1)(b), Dec. 20, 1988, 1582 U.N.T.S. 165 [hereinafter 1988 Vienna Convention].
4 United Nations Convention against Transnational Organized Crime art. 6, Nov. 15, 2000, 2225 U.N.T.S. 209 [hereinafter Palermo Convention]; see also G.A. Res. 55/25, annex I (Nov. 15, 2000).
5 Financial Action Task Force, The Forty Recommendations (2003, rev. 2012) [hereinafter FATF Forty Recommendations]. India became a FATF member in June 2010. See Financial Action Task Force, Mutual Evaluation Report: India 3 (2024).
6 Prevention of Money Laundering Act, 2002, § 3, No. 15, Acts of Parliament, 2003 (India) [hereinafter PMLA].
7 Vijay Madanlal Choudhary v. Union of India, (2022) SCC OnLine SC 929 (India). See also Prabhat Kumar,
PMLA: The Vijay Madanlal Verdict and Its Implications, 58 Econ. & Pol. Wkly. 12 (2023).
8 Income Tax Act, 1961, §§ 276C, 277, No. 43, Acts of Parliament, 1961 (India). For the 2019 amendment bringing tax offences within the PMLA Schedule, see Prevention of Money Laundering Act (Amendment), 2019, No. 2, Acts of Parliament, 2019 (India).
9 See Financial Action Task Force, Money Laundering Typologies 3–5 (1990) (introducing the three-stage model). For academic critique, see Peter Reuter & Edwin M. Truman, Chasing Dirty Money: The Fight Against Money Laundering 13–16 (2004).
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